Understanding Cognitive Biases

Cognitive biases affect judgment, leading to perceptual distortion, inaccurate judgments, or illogical interpretation. They are systematic patterns of deviation from norm or rationality in judgment, influencing the decisions and judgments that humans make.

Anchoring bias occurs when individuals rely too heavily on an initial piece of information to make subsequent judgments. For example, first impressions can disproportionately influence later decisions, even with new information.

The Dunning-Kruger effect is a cognitive bias wherein people with low ability at a task overestimate their ability. It arises from an internal illusion in low-ability individuals and an external misperception in high-ability individuals.

The sunk cost fallacy is a decision-making bias causing one to follow through on an endeavor because of previously invested resources, time, or money, disregarding the current costs and benefits.

Confirmation bias is the tendency to search for, interpret, favor, and recall information in a way that confirms one's preexisting beliefs or hypotheses, while giving disproportionately less consideration to alternative possibilities.

Status quo bias is an emotional bias; a preference for the current state of affairs. The current baseline is taken as a reference point, and any change from that baseline is perceived as a loss.

Hindsight bias is the inclination to see events that have already occurred as being more predictable than they were before they took place. It's also known as the 'knew-it-all-along' phenomenon and can lead to overconfidence in one's predictive abilities.